WestJet 2Q profit rises 66%; LCC to add premium economy seats

WestJet 737-700. By Rob Finlayson

Calgary-based low-cost carrier WestJet (WS) reported second-quarter net income of C$42.5 million ($42.4 million), up 65.9% over a C$25.6 million net profit in the prior-year period. It also announced it will move away from a one-class passenger product by introducing a premium economy section in the cabins of its 737NGs next year.

President and CEO Gregg Saretsky said in a statement, “Momentum continues at WestJet and we are very pleased with the operating margin expansion achieved again this quarter.” In its 29th straight quarter in the black, WS said it achieved an operating margin of 8.7%, up 1.8 points year-over-year.

WS noted its new premium economy section will feature “four rows of extra legroom seating with 36 inches of pitch and convenience features such as priority boarding as well as complimentary on-board amenities.” It said modifications will start this month with the fleet to be “fully reconfigured” by year end.

As part of the reconfiguring, WS said it will also standardize the seat pitch from 31 in. to 32 in. on all economy seats.

“We believe that both business and leisure guests will appreciate the added value a premium economy product will offer and look forward to providing further details as we roll it out early next year,” Saretsky said.

He added that the carrier firmed its order Tuesday with Bombardier for 20 Q400s to be used to launch a new regional airline in the second half of 2013 (ATW Daily News, June 28). Seven Q400s are slated for delivery next year, followed by seven in 2014, four in 2015 and two in 2016.

WS’s second-quarter revenue rose 9% year-over-year to C$809.3 million while expenses grew 6.9% to C$738.8 million, producing an operating profit of C$70.5 million, up 37.4%. Second-quarter traffic heightened 7.4% to 4.4 billion RPMs on a 2.9% increase in capacity to 5.39 billion ASMs, producing a load factor of 81.6%, up 3.5 points.

source: atwonline.com